Lately, there has been a lot of talk in the news and around the valley about the Bonneville Power Administration (BPA) offering a four year power supply deal to Columbia Falls Aluminum Company (CFAC).
As you’ve read here in the Beacon, the deal is subject to environmental review and other what-ifs, so it isn’t a done deal quite yet.
Given the economic struggles we’re facing in Columbia Falls, any news of new jobs is good news. Really good news, in fact.
Still, the topic of CFAC concerns me… Folks who have lived in Columbia Falls far longer than I know the history of CFAC first hand. To summarize for everyone else: It opens. It lays off / closes. It changes hands. It opens. It lays off / closes. And so on.
Again, Lucy pulls it away
CFAC has at times been our employment Lucy (from the “Peanuts” comic strip). Just as Charlie Brown (workers) approaches to kick the football, Lucy pulls it away and Charlie goes flying through the air, screaming and lands flat on his back.
No matter how good things are when CFAC is rocking, a shutdown ripples through the financial well-being of our fair town’s families and the businesses that serve them. The impact of the historical ups-and-downs of CFAC on those families is unimaginable.
To their credit, CFAC’s troubles haven’t always been bad news for the valley.
In at least one case, their troubles have generated substantial benefits. Several years back, CFAC paid their people to do what amounted to volunteer work for a number of groups that couldn’t have otherwise afforded the labor. Many organizations benefited big time from the hard work their employees provided back then – and continue to benefit from the work done back then.
Don’t be a commodity
It isn’t as if these troubles were created on purpose (feel free to argue about that in the comments).
While it may not have started that way in the 1950s, the CFAC of modern times is incredibly sensitive to the whims of commodity prices. Many businesses deal with commodity prices somehow affecting some part of their business. CFAC’s business has it as part of their raw materials supply, energy supply and their finished product. As things sit today, it’s a tough, tough business they’re in.
Imagine having someone else setting the prices of every major component of your business. Now imagine that the ingots you ship are not substantially different (speaking very generally here) from those shipped by a Chinese firm using labor that works for $10 a day, ore that’s mined locally by workers paid similarly, and so on.
Advice to everyone else – do whatever you can to avoid getting yourself into a commodity market. If you’re in one, work on your business model to get out of it.
In fact, that’s my advice to CFAC, though they didn’t ask. Let’s call it a wish for the betterment of Columbia Falls and the entire valley.
The Whole Valley
Wait a minute…the whole valley? Absolutely. It’s about airline seats, hotel rooms and rental cars. It’s about cafes and catering. It’s about grocery and clothing stores. It’s about car dealers and construction work.
My wish is that in four years no one cares what electricity costs CFAC. Not because they are gone, but because whatever they sell has so much value that people will pay whatever it takes to get it. It worries me deeply that in four years we’ll be right back where we are now.
What I’d like to see is for CFAC to add a ton of value to the aluminum they produce, *before* it hits the rails. I’m told CFAC had some of the best millwrights anywhere who could create “anything”.
I wonder
I wonder what CFAC could make that would allow them to sell a product that doesn’t get sold on commodity markets based on someone else’s price control. I wonder what they can manufacture with the skills and backgrounds of the people who worked there for the last 20-30-40 years.
I wonder what would happen to a community manufacturing valuable products for today’s economy, rather than commodities from my grandfather’s economy.
I wonder what would happen if Charlie got to kick the ball.
Want to learn more about Mark or ask him to write about a business, operations or marketing problem? See Mark’s site or contact him via email at mriffey at flatheadbeacon.com.